Honeywell Delivers
$1.71 Earnings Per Share, Up 10
Percent
- Normalized for Tax, Earnings Per Share of $1.66, Up 11 Percent Excluding
Divestitures,
Exceeds High End of Guidance Range
- Reported Sales ~Flat, Organic Up Over 2 Percent
- Operating Income Margin Expansion of 100 bps, Segment
Margin Expansion of 70 bps
- Free Cash Flow 6X Greater Than First-Quarter 2016
- Raising Low-End of 2017 EPS Guidance Range by 5 Cents to $6.90 -
$7.10
MORRIS PLAINS, N.J.,
April 21, 2017 -- Honeywell
(NYSE: HON) today announced financial results for the first
quarter of 2017 and updated its full-year 2017 earnings
guidance.
"Honeywell reported a strong start to 2017, with over 2 percent
organic sales growth, 70 basis points of segment margin expansion,
and free cash flow of nearly $800
million that was more than six times greater than 2016. Our
strong operational performance resulted in reported earnings per
share of $1.71. Normalizing for tax,
earnings per share was $1.66, or
2 cents above the high-end of our
first-quarter guidance and up 11 percent versus last year,
excluding divestitures," said Darius
Adamczyk, President and Chief Executive Officer of
Honeywell.
"Each of our businesses contributed," Adamczyk said. "The
commercial aftermarket within Aerospace and the global distribution
business within Home and Building Technologies remained strong. In
Performance Materials and Technologies, robust demand for
Solstice® low-global-warming products drove double-digit
organic growth in Advanced Materials, and improving conditions in
the oil and gas industry bolstered ongoing strength in UOP. In
Safety and Productivity Solutions, demand for warehouse solutions
and industrial safety products enabled growth in the quarter."
Adamczyk concluded, "Our diversified portfolio, coupled with the
investments we've made over the past several years, drove our
excellent performance in the first quarter. As a result of our
performance, we are raising the low end of our full-year guidance
by 5 cents. We now anticipate that
2017 earnings per share will be $6.90 to
$7.10, up 7 percent to 10 percent, excluding divestitures,
any pension mark-to-market adjustments, and 2016 debt refinancing
charges. We look forward to continuing our track record of
performance and we remain focused on accelerating our organic
growth, continuing to expand margins by maintaining our
productivity rigor, delivering best-in-class returns as the leading
software-industrial company, and more aggressively deploying
capital."
Honeywell will discuss the results during its investor
conference call today starting at 9:30 a.m.
Eastern Daylight Time.
First Quarter Performance
Honeywell sales for the first quarter were flat on a
reported basis and up over 2 percent on an organic basis. The
difference between reported and organic sales is due to the impact
of foreign currency translation, the 2016 spin-off of the former
Resins and Chemicals business in Performance Materials and
Technologies, and the 2016 divestiture of the Aerospace government
services business, partially offset by acquisitions, primarily
Intelligrated in Safety and Productivity Solutions. The
first-quarter financial results can be found in Tables 1 and 2
below.
Aerospace sales for the first quarter were flat on an
organic basis driven by growth in the Air Transport aftermarket and
gas turbo penetration in Europe
and China, offset by lower OE
volumes in Business and General Aviation. Overall, Defense and
Space sales were flat on an organic basis in the quarter. Segment
margin expanded 90 bps to 22.4 percent, driven by restructuring
benefits, productivity net of inflation, and commercial excellence,
partially offset by lower Business and General Aviation
volumes.
Home and Building Technologies sales for the first
quarter were up 3 percent on an organic basis driven by strong
performance in Distribution, air and water products growth in
China, and the impact of new
product introductions. Segment margin expanded 70 bps to 15.2
percent, driven by restructuring benefits and productivity net of
inflation, partially offset by growth investments.
Performance Materials and Technologies sales for the
first quarter were up 5 percent on an organic basis driven by a
continued increase in Solstice® sales in Advanced
Materials and strong modular gas processing growth in UOP. Segment
margin expanded 260 bps to 22.8 percent, driven by productivity net
of inflation, commercial excellence, and higher sales volume.
Safety and Productivity Solutions sales for the first
quarter were up 3 percent on an organic basis as a result of higher
volumes in safety products and workflow solutions. Segment margin
improved 50 bps to 14.7 percent, primarily driven by restructuring
benefits and productivity, net of inflation, partially offset by
acquisition amortization and integration costs. Excluding the
impact of acquisitions, segment margin expanded by more than 300
bps.
To participate in today's conference call, please dial (888)
349-9618 (domestic) or (719) 325-2385 (international) approximately
ten minutes before the 9:30 a.m. EDT
start. Please mention to the operator that you are dialing in
for Honeywell's first quarter 2017 earnings call or provide the
conference code HON1Q17. The live webcast of the investor call
as well as related presentation materials will be available through
the "Investor Relations" section of the company's Website
(www.honeywell.com/investor). Investors can hear a replay of the
conference call from 1:30 p.m. EDT,
April 21, until 1:30 p.m. EDT, April
28, by dialing (888) 203-1112 (domestic) or (719) 457-0820
(international). The access code is 7717044.
TABLE 1: SUMMARY OF FINANCIAL RESULTS
– TOTAL HONEYWELL
|
1Q 2016 |
1Q 2017 |
Change |
Sales |
9,522 |
9,492 |
~Flat |
Organic |
|
|
2% |
Segment Margin |
18.1% |
18.8% |
70 bps |
Operating Income Margin |
17.8% |
18.8% |
100 bps |
Earnings Per Share |
|
|
|
Reported |
$1.56 |
$1.71 |
10% |
Ex-Divestitures, Normalized for
Expected Full-Year Tax Rate of 25% |
$1.50 |
$1.66 |
11% |
Cash Flow From Operations |
319 |
940 |
195% |
Free Cash Flow1 |
125 |
772 |
518% |
|
|
|
|
TABLE 2: SUMMARY OF FINANCIAL RESULTS
– SEGMENTS
|
|
|
|
|
|
|
|
AEROSPACE |
1Q 2016 |
1Q 2017 |
Change |
Sales |
3,705 |
3,546 |
(4%) |
Segment Profit |
798 |
796 |
~Flat |
Segment Margin |
21.5% |
22.4% |
90 bps |
|
|
|
|
|
|
|
|
HOME AND BUILDING
TECHNOLOGIES |
|
|
|
Sales |
2,477 |
2,553 |
3% |
Segment Profit |
360 |
389 |
8% |
Segment Margin |
14.5% |
15.2% |
70 bps |
|
|
|
|
|
|
|
|
PERFORMANCE MATERIALS AND
TECHNOLOGIES |
|
|
|
Sales |
2,281 |
2,069 |
(9%) |
Segment Profit |
461 |
471 |
2% |
Segment Margin |
20.2% |
22.8% |
260 bps |
|
|
|
|
|
|
|
|
|
|
|
|
SAFETY AND PRODUCTIVITY
SOLUTIONS |
|
|
|
Sales |
1,059 |
1,324 |
25% |
Segment Profit |
150 |
194 |
29% |
Segment Margin |
14.2% |
14.7% |
50 bps |
Ex-M&A |
|
|
330 bps |
|
|
|
|
|
|
|
|
Honeywell (http://www.honeywell.com/) is a Fortune 100
software-industrial company that delivers industry specific
solutions that include aerospace and automotive products and
services; control technologies for buildings, homes, and industry;
and performance materials globally. Our technologies help
everything from aircraft, cars, homes and buildings, manufacturing
plants, supply chains, and workers become more connected to make
our world smarter, safer, and more sustainable. For more
news and information on Honeywell, please visit
www.honeywell.com/newsroom.
This release contains certain statements that may be deemed
"forward-looking statements" within the meaning of Section 21E of
the Securities Exchange Act of 1934. All statements, other than
statements of historical fact, that address activities, events or
developments that we or our management intends, expects, projects,
believes or anticipates will or may occur in the future are
forward-looking statements. Such statements are based upon certain
assumptions and assessments made by our management in light of
their experience and their perception of historical trends, current
economic and industry conditions, expected future developments and
other factors they believe to be appropriate. The forward-looking
statements included in this release are also subject to a number of
material risks and uncertainties, including but not limited to
economic, competitive, governmental, and technological factors
affecting our operations, markets, products, services and prices.
Such forward-looking statements are not guarantees of future
performance, and actual results, developments and business
decisions may differ from those envisaged by such forward-looking
statements. We identify the principal risks and uncertainties that
affect our performance in our Form 10-K and other filings with the
Securities and Exchange Commission.
______________________________
1 Cash Flow From Operations Less Capital
Expenditures
Contacts: |
|
|
|
Media |
Investor Relations |
Robert C. Ferris |
Mark Macaluso |
(973) 455-3388 |
(973) 455-2222 |
rob.ferris@honeywell.com |
mark.macaluso@honeywell.com |
Honeywell International Inc |
Consolidated Statement of Operations (Unaudited) |
(Dollars in millions, except per share amounts) |
|
|
|
|
|
|
|
Three
Months Ended |
|
|
March
31, |
|
|
2017 |
|
2016 |
|
|
|
|
|
Product sales |
$
7,540 |
|
$
7,619 |
Service sales |
1,952 |
|
1,903 |
Net sales |
9,492 |
|
9,522 |
|
|
|
|
|
Costs, expenses and
other |
|
|
|
Cost of products sold (A) |
5,237 |
|
5,349 |
Cost of services sold (A) |
1,119 |
|
1,198 |
|
|
6,356 |
|
6,547 |
Selling, general and administrative expenses (A) |
1,349 |
|
1,280 |
Other (income) expense |
(12) |
|
(18) |
Interest and other financial charges |
75 |
|
85 |
|
|
7,768 |
|
7,894 |
|
|
|
|
|
Income before
taxes |
1,724 |
|
1,628 |
Tax expense |
392 |
|
402 |
|
|
|
|
|
Net income |
1,332 |
|
1,226 |
|
|
|
|
|
Less: Net income
attributable to the noncontrolling interest |
6 |
|
10 |
|
|
|
|
|
Net income
attributable to Honeywell |
$
1,326 |
|
$
1,216 |
|
|
|
|
|
Earnings per share of
common stock - basic |
$
1.74 |
|
$
1.58 |
|
|
|
|
|
Earnings per share of
common stock - assuming dilution |
$
1.71 |
|
$
1.56 |
|
|
|
|
|
Weighted average
number of shares outstanding - basic |
763.1 |
|
767.9 |
|
|
|
|
|
Weighted average
number of shares outstanding - assuming dilution |
773.9 |
|
779.6 |
|
|
|
|
|
(A) Cost of products and services sold
and selling, general and administrative expenses include amounts
for repositioning and other charges, pension and other
postretirement (income) expense, and stock compensation
expense. |
Honeywell International Inc |
Segment
Data (Unaudited) |
(Dollars in millions) |
|
|
|
|
|
|
|
|
Three
Months Ended |
|
|
|
March
31, |
|
Net Sales |
2017 |
|
2016 |
|
|
|
|
|
|
|
Aerospace |
$
3,546 |
|
$
3,705 |
|
|
|
|
|
|
|
Home and Building
Technologies |
2,553 |
|
2,477 |
|
|
|
|
|
|
|
Performance Materials
and Technologies |
2,069 |
|
2,281 |
|
|
|
|
|
|
|
Safety and
Productivity Solutions |
1,324 |
|
1,059 |
|
|
|
|
|
|
|
Total |
$
9,492 |
|
$
9,522 |
|
|
|
|
|
|
|
Reconciliation of Segment Profit to Income Before Taxes |
|
|
|
|
|
|
|
|
Three
Months Ended |
|
|
|
March
31, |
|
Segment Profit |
2017 |
|
2016 |
|
|
|
|
|
|
|
Aerospace |
$
796 |
|
$
798 |
|
|
|
|
|
|
|
Home and Building
Technologies |
389 |
|
360 |
|
|
|
|
|
|
|
Performance Materials
and
Technologies |
471 |
|
461 |
|
|
|
|
|
|
|
Safety and
Productivity Solutions |
194 |
|
150 |
|
|
|
|
|
|
|
Corporate |
(61) |
|
(49) |
|
|
|
|
|
|
|
Total segment profit |
1,789 |
|
1,720 |
|
|
|
|
|
|
|
Other income (expense)
(A) |
6 |
|
12 |
|
Interest and other
financial charges |
(75) |
|
(85) |
|
Stock compensation
expense (B) |
(50) |
|
(53) |
|
Pension ongoing income
(B) |
179 |
|
150 |
|
Other postretirement
income (B) |
4 |
|
9 |
|
Repositioning and
other charges (B) |
(129) |
|
(125) |
|
|
|
|
|
|
|
Income before
taxes |
$
1,724 |
|
$
1,628 |
|
|
|
|
|
|
|
(A) |
Equity income (loss)
of affiliated companies is included in segment profit. |
|
|
|
|
|
|
|
(B) |
Amounts included in
cost of products and services sold and selling, general
and administrative expenses. |
|
|
|
|
|
|
|
|
Honeywell International Inc |
Consolidated Balance Sheet (Unaudited) |
(Dollars in millions) |
|
|
|
|
|
|
|
|
|
March 31, |
|
December 31, |
|
|
|
2017 |
|
2016 |
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$
7,710 |
|
$
7,843 |
Short-term investments |
|
1,885 |
|
1,520 |
Accounts receivable - net |
|
8,155 |
|
8,177 |
Inventories |
|
4,652 |
|
4,366 |
Other current assets |
|
1,178 |
|
1,152 |
|
Total current assets |
|
23,580 |
|
23,058 |
|
|
|
|
|
|
Investments and
long-term receivables |
|
533 |
|
587 |
Property, plant and
equipment - net |
|
5,816 |
|
5,793 |
Goodwill |
|
17,827 |
|
17,707 |
Other intangible
assets - net |
|
4,592 |
|
4,634 |
Insurance recoveries
for asbestos related liabilities |
|
407 |
|
417 |
Deferred income
taxes |
|
337 |
|
347 |
Other assets |
|
1,687 |
|
1,603 |
|
|
|
|
|
|
|
Total assets |
|
$
54,779 |
|
$
54,146 |
|
|
|
|
|
|
LIABILITIES AND
SHAREOWNERS' EQUITY |
|
|
|
|
Current
liabilities: |
|
|
|
|
Accounts payable |
|
$
5,805 |
|
$
5,690 |
Commercial paper and other short-term borrowings |
|
3,415 |
|
3,366 |
Current maturities of long-term debt |
|
1,271 |
|
227 |
Accrued liabilities |
|
6,790 |
|
7,048 |
|
Total current liabilities |
|
17,281 |
|
16,331 |
|
|
|
|
|
|
Long-term debt |
|
11,181 |
|
12,182 |
Deferred income
taxes |
|
414 |
|
486 |
Postretirement benefit
obligations other than pensions |
|
546 |
|
473 |
Asbestos related
liabilities |
|
1,002 |
|
1,014 |
Other liabilities |
|
3,877 |
|
4,110 |
Redeemable
noncontrolling interest |
|
3 |
|
3 |
Shareowners'
equity |
|
20,475 |
|
19,547 |
|
|
|
|
|
|
|
Total liabilities, redeemable noncontrolling interest and
shareowners' equity |
|
$
54,779 |
|
$
54,146 |
Honeywell International Inc |
Consolidated Statement of Cash Flows (Unaudited) |
(Dollars in millions) |
|
|
|
|
|
|
|
Three
Months Ended |
|
|
March
31, |
|
|
2017 |
|
2016 |
Cash flows from operating
activities: |
|
|
|
|
Net income |
|
$ 1,332 |
|
$ 1,226 |
Less: Net
income attributable to the noncontrolling interest |
|
6 |
|
10 |
Net income
attributable to Honeywell |
|
1,326 |
|
1,216 |
Adjustments to
reconcile net income attributable to Honeywell to net |
|
|
|
|
cash provided
by operating activities: |
|
|
|
|
Depreciation |
|
170 |
|
179 |
Amortization |
|
101 |
|
74 |
Repositioning and other
charges |
|
129 |
|
125 |
Net payments for
repositioning and other charges |
|
(137) |
|
(134) |
Pension and other
postretirement income |
|
(183) |
|
(159) |
Pension and other
postretirement benefit payments |
|
(24) |
|
(38) |
Stock compensation
expense |
|
50 |
|
53 |
Deferred income
taxes |
|
(42) |
|
48 |
Other |
|
14 |
|
88 |
Changes in assets and
liabilities, net of the effects of |
|
|
|
|
acquisitions and
divestitures: |
|
|
|
|
Accounts receivable |
|
23 |
|
(208) |
Inventories |
|
(286) |
|
(241) |
Other
current assets |
|
(25) |
|
(54) |
Accounts payable |
|
115 |
|
(113) |
Accrued liabilities |
|
(291) |
|
(517) |
Net cash provided by operating
activities |
|
940 |
|
319 |
|
|
|
|
|
Cash flows from investing
activities: |
|
|
|
|
Expenditures
for property, plant and equipment |
|
(168) |
|
(194) |
Proceeds from
disposals of property, plant and equipment |
|
24 |
|
1 |
Increase in
investments |
|
(1,256) |
|
(836) |
Decrease in
investments |
|
825 |
|
880 |
Cash paid for
acquisitions, net of cash acquired |
|
- |
|
(1,056) |
Other |
|
(29) |
|
9 |
Net cash used for investing
activities |
|
(604) |
|
(1,196) |
|
|
|
|
|
Cash flows from financing
activities: |
|
|
|
|
Proceeds from
issuance of commercial paper and other short-term borrowings |
|
2,468 |
|
6,300 |
Payments of
commercial paper and other short-term borrowings |
|
(2,467) |
|
(8,750) |
Proceeds from
issuance of common stock |
|
221 |
|
105 |
Proceeds from
issuance of long-term debt |
|
11 |
|
4,448 |
Payments of
long-term debt |
|
(5) |
|
(419) |
Repurchases of
common stock |
|
(310) |
|
(1,156) |
Cash dividends
paid |
|
(503) |
|
(499) |
Payments to
purchase the noncontrolling interest |
|
- |
|
(238) |
Other |
|
(33) |
|
(14) |
Net cash used for financing
activities |
|
(618) |
|
(223) |
|
|
|
|
|
Effect of foreign exchange rate
changes on cash and cash equivalents |
|
149 |
|
118 |
Net decrease in cash and cash
equivalents |
|
(133) |
|
(982) |
Cash and cash equivalents at
beginning of period |
|
7,843 |
|
5,455 |
Cash and cash equivalents at end
of period |
|
$ 7,710 |
|
$ 4,473 |
Honeywell International
Inc
Reconciliation of Cash Provided by Operating Activities to Free
Cash Flow (Unaudited)
(Dollars in millions) |
|
|
|
|
|
|
|
Three Months Ended |
|
March 31, |
|
2017 |
|
2016 |
|
|
|
|
|
|
Cash provided by operating activities |
$ |
940 |
|
$ |
319 |
Expenditures for property, plant
and
equipment |
|
(168) |
|
|
(194) |
Free cash flow |
$ |
772 |
|
$ |
125 |
|
|
|
|
|
|
We define free cash flow as cash
provided by operating activities less cash expenditures for
property, plant and equipment. |
|
|
|
|
|
|
We believe that this metric is useful
to investors and management as a measure of cash generated by
business operations that will be used to repay scheduled debt
maturities and can be used to invest in future growth through new
business development activities or acquisitions, pay dividends,
repurchase stock or repay debt obligations prior to their
maturities. This metric can also be used to evaluate our ability to
generate cash flow from business operations and the impact that
this cash flow has on our liquidity. |
Honeywell International Inc |
Reconciliation of
Segment Profit to Operating Income and Calculation of Segment
Profit and Operating Income Margins (Unaudited) |
(Dollars in millions) |
|
|
|
|
|
|
Three
Months Ended |
|
March
31, |
|
|
2017 |
|
2016 |
|
|
|
|
|
Segment Profit |
|
$
1,789 |
|
$
1,720 |
|
|
|
|
|
Stock compensation expense
(A) |
|
(50) |
|
(53) |
Repositioning and other (A,
B) |
|
(135) |
|
(131) |
Pension ongoing income (A) |
|
179 |
|
150 |
Other postretirement income
(A) |
|
4 |
|
9 |
Operating Income |
|
$
1,787 |
|
$
1,695 |
|
|
|
|
|
Segment Profit |
|
$
1,789 |
|
$
1,720 |
÷ Sales |
|
9,492 |
|
9,522 |
Segment Profit Margin % |
|
18.8% |
|
18.1% |
|
|
|
|
|
Operating Income |
|
$
1,787 |
|
$
1,695 |
÷ Sales |
|
9,492 |
|
9,522 |
Operating Income Margin % |
|
18.8% |
|
17.8% |
|
|
|
|
|
|
|
|
|
|
(A) Included in cost of products and
services sold and selling, general and administrative expenses.
(B) Includes repositioning, asbestos, environmental expenses and
equity income adjustment. |
|
We believe these measures are useful
to investors and management in understanding our ongoing operations
and in analysis of ongoing operating trends. |
Honeywell International Inc |
Calculation of Segment Profit Margin Excluding Mergers and
Acquisitions (Unaudited) |
(Dollars in millions) |
|
|
|
|
|
|
|
Three Months Ended |
|
March
31, |
|
|
2017 |
|
2016 |
|
Safety and Productivity
Solutions |
|
|
|
|
|
Segment Profit excluding mergers
and acquisitions |
|
$
190 |
|
$
149 |
|
÷ Sales excluding mergers and
acquisitions |
|
$
1,080 |
|
$
1,041 |
|
Segment Profit Margin excluding
mergers and acquisitions % |
|
17.6% |
|
14.3% |
|
|
|
|
|
|
|
We believe these measures are useful
to investors and management in understanding our ongoing operations
and in analysis of ongoing operating trends. |
|
Honeywell International Inc |
Reconciliation of Organic Sales % Change (Unaudited) |
|
|
|
|
|
Three Months Ended |
|
March
31, |
|
|
2017 |
|
Honeywell |
|
|
|
Reported sales % change |
|
- |
|
Less: Foreign currency
translation |
|
(1)% |
|
Less: Acquisitions and
divestitures, net |
|
(1)% |
|
Organic sales % change |
|
2% |
|
|
|
|
|
Aerospace |
|
|
|
Reported sales % change |
|
(4)% |
|
Less: Foreign currency
translation |
|
(1)% |
|
Less: Acquisitions and
divestitures, net |
|
(3)% |
|
Organic sales % change |
|
- |
|
|
|
|
|
Home and Building
Technologies |
|
|
|
Reported sales % change |
|
3% |
|
Less: Foreign currency
translation |
|
(2)% |
|
Less: Acquisitions and
divestitures, net |
|
2% |
|
Organic sales % change |
|
3% |
|
|
|
|
|
Performance Materials and
Technologies |
|
|
|
Reported sales % change |
|
(9)% |
|
Less: Foreign currency
translation |
|
(1)% |
|
Less: Acquisitions and
divestitures, net |
|
(13)% |
|
Organic sales % change |
|
5% |
|
|
|
|
|
Safety and Productivity
Solutions |
|
|
|
Reported sales % change |
|
25% |
|
Less: Foreign currency
translation |
|
(1)% |
|
Less: Acquisitions and
divestitures, net |
|
23% |
|
Organic sales % change |
|
3% |
|
|
|
|
|
We believe organic sales growth is a
measure that is useful to investors and management in understanding
our ongoing operations and in analysis of ongoing operating
trends. |
|
Honeywell International Inc |
Calculation of Earnings Per Share at 25% Tax Rate Excluding 2016
Divestitures (Unaudited) |
(Dollars in millions, except per share amounts) |
|
|
|
|
|
|
|
|
Three
Months Ended |
|
|
|
March
31, |
|
|
|
2017 |
|
2016 |
|
|
|
|
|
|
|
Income before taxes |
|
$
1,724 |
|
$
1,628 |
|
|
|
|
|
|
|
Taxes at 25% |
|
431 |
|
407 |
|
|
|
|
|
|
|
Net income at 25% tax rate |
|
$
1,293 |
|
$
1,221 |
|
|
|
|
|
|
|
Less: Net income attributable to
the noncontrolling interest |
|
6 |
|
10 |
|
|
|
|
|
|
|
Net income attributable to
Honeywell at 25% tax rate |
|
$
1,287 |
|
$
1,211 |
|
|
|
|
|
|
|
Weighted average number of shares
outstanding - assuming dilution |
|
773.9 |
|
779.6 |
|
|
|
|
|
|
|
Earnings per share at 25% tax
rate |
|
$
1.66 |
|
$
1.55 |
|
Earnings per share impact
attributable to 2016 divestitures (1) |
|
- |
|
0.05 |
|
Earnings per share of common stock
- assuming dilution, at 25% tax rate, |
|
|
|
|
|
excluding 2016 divestitures |
|
$
1.66 |
|
$
1.50 |
|
|
|
|
|
|
|
Earnings per share of common stock
- assuming dilution |
|
$
1.71 |
|
$
1.56 |
|
Earnings per share impact of
normalizing to 25% tax rate |
|
0.05 |
|
0.01 |
|
Earnings per share impact
attributable to 2016 divestitures (1) |
|
- |
|
0.05 |
|
Earnings per share of common stock
- assuming dilution, at 25% tax rate, |
|
|
|
|
|
excluding 2016 divestitures |
|
$
1.66 |
|
$
1.50 |
|
|
|
|
|
|
|
(1) Earnings per share attributable to
2016 divestitures uses weighted average shares of 779.6 million and
a blended tax rate of 36.0% for three months ended March 31,
2016. |
|
|
|
|
|
|
|
We believe earnings per
share adjusted to expected 2017 full-year tax rate of
approximately 25% is a measure that is useful to investors and
management in understanding our ongoing operations and in analysis
of ongoing operating trends. |
|
|
|
Honeywell International Inc |
Reconciliation of
Earnings Per Share to Earnings Per Share, Excluding Pension
Mark-to-Market Expense, Debt Refinancing Expense and Earnings
Attributable to 2016 Divestitures (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended |
|
|
|
December 31, |
|
|
|
|
2017E
(1) |
|
|
|
2016
(2) |
|
|
|
|
|
|
|
|
|
|
Earnings per share of common stock
- assuming dilution (EPS) |
|
|
TBD |
|
|
|
$
6.20 |
|
|
|
|
|
|
|
|
|
|
Pension mark-to-market
expense |
|
|
TBD |
|
|
|
0.28 |
|
Debt refinancing expense |
|
|
- |
|
|
|
0.12 |
|
|
|
|
|
|
|
|
|
|
EPS, excluding pension
mark-to-market expense and debt refinancing expense |
|
|
$6.90 -
$7.10 |
|
|
|
6.60 |
|
|
|
|
|
|
|
|
|
|
Earnings attributable to 2016
divestitures |
|
|
- |
|
|
|
(0.14) |
|
|
|
|
|
|
|
|
|
|
EPS, excluding pension
mark-to-market expense, debt refinancing expense and |
|
|
|
|
|
|
|
|
earnings attributable to 2016
divestitures |
|
|
$6.90 -
$7.10 |
|
|
|
$
6.46 |
|
|
|
|
|
|
|
|
|
|
(1) Utilizes weighted
average shares of approximately 774 million and an expected
effective tax rate of approximately 25% |
|
(2)
Utilizes weighted average shares of 775.3 million. Pension
mark-to-market expense uses a blended tax rate of 21.3%.
Debt
refinancing expense uses a tax rate
of 26.5%. Earnings attributable to 2016 divestitures use a
blended tax rate of 33.9%. |
|
|
|
|
|
|
|
|
|
|
|
We believe EPS, excluding pension
mark-to-market expense, debt refinancing expense and earnings
attributable to 2016 divestitures is a measure that is useful to
investors and management in understanding our ongoing operations
and in analysis of ongoing operating trends. Management
cannot reliably predict or estimate, without unreasonable effort,
the pension mark-to-market expense as it is dependent on
macroeconomic factors, such as interest rates and the return
generated on invested pension plan assets. We therefore do
not include an estimate for the pension mark-to-market expense in
this reconciliation. Management is not currently forecasting
an impact to earnings per share arising from a debt refinancing or
divestiture transaction. Based on economic and industry
conditions, future developments and other relevant factors, these
assumptions are subject to change. |
|